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Major AA Devaluation
Well there’s no way around it, American Airlines just announced their new award chart for award redemptions starting in March 2016 and it’s nothing short of a disaster for those who like to fly first class.
A few notable examples:
First class flights from the US to South Asia go from 67,500 miles to a whopping 110,000 miles – a 62% increase.
First class flights from the US to Australia go from 72,500 miles to 110,000 miles – a 60% increase
First class flights from the US to the Middle East go from 90,000 miles to 115,000 miles – an almost 30% increase
You can view the new award chart here:
http://www.aa.com/i18n/AAdvantage/redeemMiles/all-partner-chart2016.jsp
I’ll be writing a more thorough post soon to break down all the details.
Why did American Airlines increase their rates?
American Airlines has long been home to the most lucrative mileage program for first class travel. Too good in fact, with some of its award prices over 50% lower than the other mileage programs.
It was bit forthcoming when AA was giving away 50,000 miles for opening a Citibank account and increased sign up bonuses for AA credit cards started coming out.
Overall, this increase puts AA award costs to around the same as its main competitors: United and Delta
What does this mean?
The only slightly good news is that award redemptions through Aadvantage will still “price” at the old level for all award bookings until March 22, 2016. Since you can book your award flights around 11 months ahead, this means if you book on March 21, 2016 you can book for flights until February 2017.
For the next few months it will be a race against the clock as everyone tries to earn all the miles they can and then “burn them” (deplete their miles) before the massive award devaluation.
I highly suggest you start focusing your credit card applications on cards that earn AA miles, including the AA platinum personal and business card, so you can use those miles at the old award rate
What about Economy & Business Class prices?
If you prefer flying in coach, the good news is that almost all award redemptions will cost the same number of miles.
Business class award internationally do slightly go up depending on where you want to fly.
What happens after 2016?
If you’re not earning miles through flying, but instead through credit card spending and sign up bonuses, the net effect will be a slight negative. Sure the award prices for first class flights have increased dramatically, but business and economy awards remain the same or just slightly higher.
Ultimately, if you want to fly first class, you will have to apply for more credit cards then before, but it will still be attainable.
Still this is a huge blow for those of us who like to redeem miles for first class.
